The Analytics Bridge

Alexis Montecinos

Cofundador Pharu Analytics

Generative AI has caused a huge revolution in the way many people and organizations are looking at these types of solutions for real-life problems. Many universities have even considered a change in their policies regarding the application of chat GPT in the realization of exams, for example. I have read many articles talking about how firms should prepare to use these kinds of new applications on a day-to-day basis.

This phenomenon is causing a similar effect that the one experienced after the creation of the Data-Driven Organization. I remember all the organizations I advised during these years and all the big adjustments we had to make to generate value, given most of the models and solutions provided by that way of thinking did not generate value at all. The big difference in real organizations is that they behave way different than what a book describes. In the end, an analytics solution is in the majority of cases implemented by human beings, with feeling, different incentives than the algorithm, and an experience in their jobs that in many cases goes in the opposite direction than what the algorithm recommends. The way to deal with this is not data driven, for sure.

I have solved my self more than 90 different projects in different parts of the world and I can say the reality of the firm is a different story. I have many examples where very sophisticated algorithms did not provide any value at all for the firm, given nobody in the organization was connected to the solution. The way we solved this problem was to create a new way to see analytics. This was the Goal-Based Data Organization approach. A way to see strategic analytics I developed while I was a professor at MIT.

The driver of a firm can be profits, social welfare, etc. but it is never the data. The data is a way, that when well utilized can help the organization to maximize its goals, but never the opposite. I have seen many cases where a simple Dashboard that is coming from a few hours of analytics can improve the performance of the firm, considerably.

The main idea at the end is to connect the goals in the first place with the desired solutions and with this make the optimal bridge between the analytics and the firm value. The most relevant is to see the forest and not the trees, only.

This is the only way to know when we will really need generative AI or a simple Dashboard to do what we really want to do: maximize the value of our organization.

Autor:
Alexis Montecinos

Cofundador Pharu Analytics